Wingate Marketing Pty Ltd v Levi Strauss & Co

The Federal Court of Australia, in the Victoria District Registry, considered an application by Great Red Lettuce Company Pty Limited to set aside a statutory demand issued by the Commonwealth Bank of Australia. The demand sought $909,701.52 from Great Red Lettuce Company, arising from a guarantee of accounts at the bank. The applicant, which was part of a group of companies involved in hydroponic vegetable production and the sale of "Everfresh" bags, argued that it had an offsetting claim of $1.68 million stemming from a dishonoured cheque and subsequent contract termination, leading to lost profits.

The legal issues before the court were whether the applicant had an offsetting claim under section 459H(1)(b) of the Corporations Law and if the statutory demand should be set aside for other reasons. The court examined whether the applicant had demonstrated a serious question to be tried regarding the offsetting claim and whether there were other grounds to set aside the demand, such as lack of access to books of account due to the appointment of receivers.

Justice Heerey determined that the applicant had not satisfied the requirement of showing a serious question to be tried on its offsetting claim. The court found that the applicant was not the customer of the bank, and the dishonour of the cheque was not causally related to the termination of any contract by the applicant. Additionally, the applicant failed to provide details of the alleged contract with Safeway or to demonstrate that the bank had knowledge of any special circumstances that would extend liability to loss of profits. The court also dismissed the applicant's other claims, including the inability to challenge the enforceability of the guarantee and the loss of books of account by the receivers.

The application to set aside the statutory demand was dismissed, and the court ordered the applicant to pay the respondent's costs.